Monday, April 7, 2014

Determining Your Material Cost

The subject of material cost to
produce cultured marble always comes up when someone is putting together a
business plan. Even though your matrix
only consists of 25% resin it will be your biggest raw material cost so we’ll
concentrate on that first.

Worldwide, I have seen resin
prices vary from $2.00 USD to $3.50 USD per kilogram.The price you pay depends on where you buy it
and quantity you're purchasing.Here in
the USA and in Canada, resin prices should be in the $1.55 USD to $1.70 USD per
pound range. (Make a note that I referred to cost per pound here in
the USA.Most markets outside the US and
Canada will probably use Kilograms.)Obviously,
if I’m purchasing a full 20 foot container of resin from the manufacturer I’m
going to pay less per kilogram than if I buy smaller quantities from a
distributor.

Crushed limestone or calcium
carbonate makes up the remaining 75% of your marble matrix.Limestone is available everywhere in the
world and is usually quite inexpensive.Even though it’s the bulk of your matrix it’s only going to be about 10%
of your total matrix mix cost.

Every manufacturer will use some consumable
supplies that you’ll also want to include in your cost.You will use gel coat to seal your marble and
give it a non-porous, stain resistant quality, mold release waxes so you can
easily remove your products from the mold, tooling clay to make radii when
needed, tape for your divider bars, pigments for obvious reasons, etc.These quantities will vary depending on what
you’re manufacturing but I’ve found adding 20% to your resin and limestone cost
to be quite accurate.

If you know what your resin and
limestone/calcium carbonate/filler costs are, you can use this Excel sheet to
calculate your cost in Kilograms, or this Excel sheet to calculate your material cost
in Pounds.Both are using U. S. Dollars (USD).Note: There are two pages on each Excel worksheet. Click on the tabs at the bottom of each file to view both pages.

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Cultured marble is one of the most commonly used products in
bathrooms and kitchens here in the U.S. You’ll find these products in almost every
home and commercial establishment in America and it’s the perfect business in
developing countries, especially where construction is strong.Unlike imported goods, local manufacturing creates
jobs, utilizes local raw materials and supplies your local market with
customized products that are not available in standard over-the-counter type
building supply stores.